Xperts Speak is led by Melissa Akaka, Academic Director at Project X-ITE, Associate Professor of Marketing at the Daniels College of Business, Co-Director of the Consumer Insights and Business Innovation Center, and Elizabeth and Ali Machado Faculty Fellow.
Our first interview is with Michael Caston. Michael speaks about his research on identifying opportunities in unlikely situations and how entrepreneurs are faced with resource scarcity, especially in this economic downturn. He offers the Innovation Labs at the University of Denver as a valuable resource for entrepreneurs and innovators to prototype, collaborate and create. Watch the video, or read the transcript below.
Melissa Akaka: Hi, I’m here today with Michael Caston. He is an Associate Professor of the Practice in Innovation and Product Design and Development, the Executive Director of the Innovation Labs and the Faculty Director of the Innovation and Entrepreneurship Living and Learning Community at the University of Denver. He is also currently partner at CAMIC Designs where he works on industrial design projects. He comes to us with a wealth of experience and information about how we can think through design projects and think about entrepreneurship and innovation in different ways. Welcome, Michael.
Michael Caston: Thanks for having me, Melissa.
Melissa: Can you start off by telling us a little bit about your experience in both innovation and entrepreneurship?
Michael: Certainly. So I’m a serial entrepreneur, and I launched my first venture when I was 12 years old, and I’ve had several since then. My current venture, as you mentioned, is CAMIC Designs. It’s an interdisciplinary, multidisciplinary product development firm. We produce graphic design, product design, [and] web and packaging design for startups to Fortune 500 companies. And then we also produce around 60 products in-house, designing and manufacturing them ourselves with USAID partners to utilize for fundraising efforts for not-for-profit dance companies and not-for-profit animal rescues. And as a as a serial entrepreneur, I’m always very sensitive to the opportunities that students can have while they’re in school, particularly because my current venture I launched while I was in school at North Carolina State studying product design as a graduate student. And at that time, it was not celebrated to to utilize University resources to develop a for-profit venture, but it’s a great learning experience for students. So as I operated out of the University and met with clients at night, I produced product at night, and it basically hit everything that I did, and I had a bad feeling about it. So coming to the University of Denver, one of my goals was to celebrate entrepreneurship and innovation for students as a learning opportunity to grow and to fail fast and to fail forward because the University is a safe place where you have all these resources — the faculty expertise, you have programs and workshops and equipment and just a vibrant environment with people that have multiple perspectives that can provide this really unique environment for students to experiment and try things out. So that’s what I’m trying to foster at the University based on my own experiences in innovation and entrepreneurship.
Melissa: That’s awesome. So I know that you are currently working on getting your PhD and you’re doing some research on entrepreneurship, as well as running all of these awesome programs. So can you tell us a little bit about your own research and how that ties into the work that you’re doing on campus with the students.
Michael: Sure. So I’m getting a PhD in business – books about entrepreneurship and specifically new venture creation. So the chicken and the egg problem for entrepreneurs is: how do you launch a business when you lack funding and you lack legitimacy from your stakeholders? So for a very nascent or early stage venture, you need to get buy-in from potential stakeholders, like an investor so that you can launch your product or launch your business. This is difficult because you might not have any existing sales. You’re pre-revenue and you don’t have any business plan, and you don’t have even a prototype oftentimes, but you’ve got this great idea and you might need some funding to launch. So your task is to convince somebody else – albeit an investor – to buy into your idea, and this is called opportunity recognition. And it’s challenging because your opportunity or your idea might not even be formed. And it might not even be an opportunity if nobody believes in it. So a couple of projects I’m working on is one dimensionalizing the concept of an opportunity: When does an idea become an opportunity along that entrepreneurial process? And so we’ve created a new construct – my colleagues and I – called the “phantom opportunity,” and it’s a dyadic construct where you have the entrepreneur, you have the stakeholder (in this case an investor), and at some point, if the investor believes in your concept or idea, it is an opportunity. Even if it’s not the same one that you present, or the same one that you believe it is, that’s when we say the two rocks come together and the spark is is created. And we call that the”phantom opportunity.” And with some other resources and further down the line, that can be actualized and legitimized, but it’s an interesting study where you’re looking at investor cognition. So when does an investor see the opportunity, and at what point are they willing to take action?
Melissa: So part of this Xperts Speak series is to really think through this pandemic and how the pandemic has impacted our society and our economy and how it’s affecting entrepreneurs specifically. How does this idea of this “phantom opportunity” play into or provide insights into how entrepreneurs might be able to leverage this as a resource during these very uncertain times, especially uncertain times?
Michael: So there’s a lot of strategies entrepreneurs can implement. There’s a few called monthly or strategic action management, which is where you can convince investors that you’re legitimate based on symbols such as: an entrepreneur might say they have an office space and that offers some legitimacy, showing that they’re committed in some respect because they have an office space. That office space might be their basement or their parents’ basement, but it still offers that legitimacy. And in this day and age, we’re all working from home. I’ve got an office. It might just be my bedroom, but it’s legitimate in the eyes of the stakeholders. And also there’s other other opportunities like, “Hey I quit my job to focus 100 percent on my business” but you might have lost your job in this day and age. This is a good opportunity for somebody who did lose their job to launch a venture, and in terms of symbolic action management, you can say, ” I am focusing 100 percent on my business.” This shows commitment and dedication to investor.
Melissa: It’s a lot about framing and rethinking these current situations as opportunities to support your business or your startup. Very cool. What is one of the biggest challenges you see facing entrepreneurs today and how do the resources in your programs or that come out of your research help contribute to addressing some of those problems?
Michael: I think one of the biggest challenges entrepreneurs have other than a lack of legitimacy is lack of resources. Especially in this day and age, when we’re stuck in our homes not able to access resources that we typically would, and there are a lot of web tools that allow for that, but the Innovation Labs is a maker space and coworking space and it also acts as an incubator for students, so they have this great resource on campus. Once we get back to campus, they can prototype out their ideas and develop really quick MVPs, and then get feedback from consumers. And as you know, pull out consumer insights to help drive that design process. So that’s a great resource. It’s free for all students at the University. We have all types of prototyping equipment and our digital fab lab. We have laser engravers, 3D printers, sewing machines, CNC routers. We have a full Woods Lab and a full Plastics Lab as well, so you can prototype any number of things. And since it’s open to the entire University for free, including staff and faculty, you have all these happy meetings that occur there where you meet somebody from a different discipline who you might not normally meet in your classroom, and you can have these great relationships and conversations. And every entrepreneurial venture coming out of there is interdisciplinary, which helps build a really strong team, because you don’t have an entrepreneurial team of let’s say just engineers, or just finance majors. You need to have a mixture of expertise to be successful as an entrepreneur venture, and you can have those meetings right there in the Innovation Labs.
We’ve also launched our own business out of Innovation Labs, called the MicroFactory. And any student can be a part of it. And what the MicroFactory does is allows you to take that theory you’re learning in the classroom and apply it in a really practical way by gaining clients and running projects for the community and industry for pay. So it helps you build your resume, helps you learn professional practices, and gets you one step closer to bridging that gap between school and the real world. And that was something I always wanted to do, but it was a student initiative. A student, Jacob Goldman, came and founded that, and I found the funding so we could launch a proof-of-concept, and we produced 50 projects in our first year, and we’re on target to do 300 this year until COVID-19, and now we’ve converted the Innovation Labs to a PPE production facility.
Melissa: That’s amazing. So if students or staff or faculty or members of the community want to get involved and learn more or engage with the programs that you’re running, including the Innovation Labs, what is the best way for them to do that?
Melissa: Perfect. Sounds like you have so many cool things going on. Thank you so much for your time.